Here's Why Pfizer Is Going Higher -- Possibly Much Higher
Bloomberg News
Shares of Pfizer (PFE) - Get Report are trading at new 2016 highs today. The stock is up just over 1% as it begins to pierce heavy resistance near the June peak. This breakout-type move extends Pfizer's rally off Monday's low to over 6.25%.
Pfizer is now setting up well for a fresh rally leg that will likely carry the stock back up to the 2015 peak.
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After peaking on June 9, Pfizer began a healthy pullback. The stock's powerful surge off the April low, which had lifted shares over 30% by late May, was in need of a rest. The pullback from the early June high of $35.50 dropped the stock down to a very solid support zone near $34. This key area held in well during the Brexit flush despite a violation of the 50-day moving average. When Tuesday opened, Pfizer was on solid footing once again and poised for a rebound. Since then, the stock has been steadily climbing and appears headed for more gains as a new month begins.
As next week begins, Pfizer investors should expect a return to the 2015 high near $36.50. This heavy resistance area will likely require a bit of back-and-fill trade before clearing. Prior to a test of last year's highs, patient Pfizer bulls should consider the stock a low-risk buy between $35.00 and $34.50. The top band of this near-term support is marked by last week's high.
Disclosure: This article is commentary by an independent contributor. At the time of publication, the author was long PFE.